Hero Motors expects new programmes to diversify its customer base, which remains concentrated, with the top 10 customers accounting for nearly 73% of FY26 revenue and the largest client alone contributing about 36%.
The company's largest customer generated ₹422.74 crore, or 35.57% of revenue from operations in FY26, according to Hero Motors' Red Herring Prospectus (RHP). While the share declined from 38.8% in FY25, revenue from the customer was almost unchanged at ₹422.79 crore.
In FY26, the company’s top five customers accounted for 61.42% of revenue, down from 63.39% a year earlier, while the share of the top 10 fell to 72.89% from 78.03%. However, the decline in percentage terms came as Hero Motors' overall business expanded. Revenue from the top 10 customers actually increased to ₹866.14 crore from ₹850.20 crore, even as their share of the company's revenue fell.
Managing Director and CEO Amit Gupta said the company expects its customer mix to change further as new programmes under development move into production.
“With the order book we have and the projects we have developed and are developing, you will see this mix changing,” Gupta said. “The concentration is continuously declining.”
He said the nature of Hero Motors' business means diversification takes time because automotive programmes typically have a life cycle of seven to eight years and new contracts take time to ramp up.
In FY26, River Mobility, Hero MotoCorp, BMW, HMC E Valley, Enviolo, Makino Auto Industries and Ducati were among Hero Motors' top 10 customers. The company, however, did not disclose the individual contributions from the top 10 customers.
Global Business Broadens Customer Base
Hero Motors is seeking to lower concentration partly by adding international customers and expanding into new applications.
According to the company presentation, 41.36% of its FY26 revenue came from international customers, from 23 countries.
The company has customers across premium motorcycles, passenger vehicles, motorsport, e-bikes, electric vehicles and aerospace. Its disclosed customer portfolio includes BMW, Ducati, Hero MotoCorp, River Mobility, HWA, Formula Motorsport, enviolo and other global OEMs.
Hero Motors also said its relationships with the top five customers have lasted more than 12 years on average. The company is an exclusive supplier for several BMW projects and argued that the high cost of switching suppliers in the automotive industry tends to result in long-running relationships once a programme is secured.
That provides some protection against customer concentration, but the RHP identified the dependence as a material risk. It warned that losing all or a substantial portion of business from any of the top customers because of contract losses, lower customer sales, disputes or other factors could hurt the company’s revenue, profitability and cash flows.
New Businesses
The effort to widen the customer base is also linked to Hero Motors' move from being largely a component manufacturer to a supplier of complete systems.
Its Powertrain Solutions business generated ₹637.75 crore in FY26, accounting for 53.67% of total revenue, while Alloys & Metallics contributed ₹550.60 crore, or 46.33%.
Within powertrain, Gears & Transmissions generated ₹488.88 crore, while Bike Powertrain contributed ₹148.87 crore. According to the company presentation, Bike Powertrain recorded a 20.7% revenue CAGR between FY24 and FY26, compared with 8.1% for Gears & Transmissions and 0.6% for A&M.
Hero Motors is also expanding into applications beyond conventional automobiles. Its products and engineering programmes cover areas such as eVTOL aircraft, hydrogen fuel-cell aircraft, electric marine applications, off-road and speciality EVs, and electric light commercial vehicles.
The company has identified expansion into new market segments and geographies, deeper global technology partnerships, and acquisitions and joint ventures as key growth priorities. As these programmes scale, the company expects its customer mix to broaden.